Canara Bank Vs Supreme Ahmednagar Karmala Tembhurni Tollways Private Limited (NCLT Chandigarh)
The National Company Law Tribunal (NCLT), Chandigarh, admitted an application under Section 7 of the Insolvency and Bankruptcy Code, 2016 for initiation of the Corporate Insolvency Resolution Process (CIRP) against the corporate debtor for a default amount of approximately ₹283.95 crore. The financial creditor had established that loans were sanctioned and disbursed under a consortium arrangement, and defaults in repayment began from December 2015, with the account classified as a Non-Performing Asset in March 2016.
On the issue of limitation, the Tribunal held that although the date of default was 31.12.2015, the application filed in November 2024 was within limitation due to continuous acknowledgment of debt by the corporate debtor. Such acknowledgment was evidenced through a revival letter dated 12.04.2021 and entries in balance sheets for multiple financial years. Relying on Supreme Court precedent, the Tribunal held that entries in balance sheets constitute valid acknowledgment under Section 18 of the Limitation Act, thereby extending the limitation period.
Regarding the existence of debt and default, the Tribunal found that documentary evidence, including loan agreements, sanction letters, and statements of accounts, clearly established disbursement and non-repayment. The corporate debtor had not denied the debt, and authenticated records from the information utility confirmed default exceeding the statutory threshold.
